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,., li,_.1 The Review School of Accountancy
lTel. No. 735-9aO7 & 734-39A9
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PRACIICAL ACCOUNTIN _ , C. UberitalC. Espenilla/G. MacariolA

Statement of Financial Position

The accounts and balances showrt below were galhcred lrr>rn Clown Clompany's trial balance on I)ecember 31,
2017. All ad.iusting cntries have been madc.

Property, plant and equipmcnt, P500,000; biological asscts, P200,000; Goodwill on cornbination, I,300,000;
Identifiable intangible assets. P150,000; Invcstment property, t,200,000; Investment in associates. P200,000;
Available lbr sale investments, P100.000; Inventories^_129&000;\ l-rade and other receivablcs,
,p300,000.;\
Irinancial assets:rt fair value through profir or lcrss,,,'f1500iiD Cash nnd cash e<1uivalents,el00,ff)il Sn'i"
capital, P800,000; C)ther rcserves, P300,000; Reraincd profits, I,2-50,000; Non-oontrolling intci6t, p250,000;
I-ong-tenn bjnqi"gr. P200.000; Dcferrcd tax. P5O000; Long-rcrm provisions, pI00,000; 'I'radc and other
payables,
€g-OgU; Short-term borrowings, {!!,AOS; Currenl portion of long-tenn borrowings,,P.3-0,000;'
Currcnt tax payablcr P I 50,000'and Short-tcrm provisions,, P20,000.

'\l Ouestion l: IIow rrruch should be the amount cr{'cqrrerl!gsst-t on Clown's L)ecember 31,2A17 balance sheel?
a. P600,000 c. I'}700.000
b. P650.000 g) P7s0,000

Ouestion 2:. IIo*' much should bc 0re amount of current lialilitics, to be reported in the I)ecember 31. 201(t
balance sheet ol'Clowtr Company'?
a. P 420.000 @ t,+so.oorr
b. P430.000 d. P470.0C10
(.)ue.stion -l:. l-lttw nmch should be shor.vrr as total cquity and liabilities of Clown Company
') as r>f l)ec. 31,2017'l
a. I'}2.000.000 c. I'}2,300,000
h. P2.250.000 ..tl l,z,+oo.ooti
' --- ::--"Fflbi'lNrtngfttmrmmi-rIi€irriftr.{i(, aF@ildTThe current accounlingi.portihgpcriod.
a. At the cnd of the reporting pt:riod it.t()mat_() srowcr's vines are bearing partially developcd tomatoes.. .l.hc
lile of the tonlato virre is abouQln-lltri'fhc cstimated fair r,ahqe o1'the ron.rato vines is (50.00pancl
estimatcd c()st to sc'll is P3.0(Xl; rhe $uits thcy bcar can bc sold ar an ac_1i'..e *lt!l tclr pS<i,06b- 'fhc
.and
cstirnated ctz1t to 1cl[ o1'the liuit isr.pQ00{nd estimated hansporrarion cosl}) f!.t!ri ]

\rt h' -'rt the end.9!-itrS-Isplling pcriod a citrus €rowcr's liuil trec's pariially tcar ttivclopcd orangcs. -c;i+ft+r(rccs
I* i hcar Inttt () /cr-f,nanv y_car-$ 'fhc estitnatcd lirir valuc ol'tlrc citrus t.recs ip-f 125.0O0 and cstimated. c{)sl. t()
sellisP4,000;andthclruitthcybcarcanbesoldatanu!!i.,.'{ rl:u'lg:iatP1i0,000. Estimate6costtoscll the
oranges is 114,000 and cstirnatcd triursportation cost : ,,, .l,rit). .
j ::.| )
't a ,, !'
', | ', :, - ,,t-a rlL
U \\ lral.total.amounl <r-1-curr-enl-as.set should be reported baserl on tlrt; abovc in{irnnation? . i ,, r ."', ), / il)
.i I,92.000 c. 11192.000 , : ,.1
.;.

l. I'rcscntcd bclow arc account balances and relatcd intirmration on l)ccernber 31, 2015 for l)ccoy Cornpany:
\A
ll
Cash orr hand and in bank, t'1.200,000; Accounls receivable. 11950.0000; Notes lteceivable, pl.{X)0,000;
Merchandisc invcntory. PI,500,000; Prepaid expenscs. p400,000.

T'hc following arc rclevant infomratit'rn related 1o thc above aocounts:

1' Included in the cash in bank account is a time deposit ot'I)200,000 with a term of six months.
.* 2. !]sJl5la!s o1't50'000 is to be madc otr thc account receivable lbr luture returnJand discounts which werc
considered probablc"
J, 'lhc account receivable lngiurtcs a P500;000 assigncd receivable, and P300,000 lhctorcd to a linance
company for which thc company has transferred !r-Bni.liqa$t--apounl of risks and rewards of ownership.
4. 'l'he note receivable does nul incluric u P200,000 Jiscounted
to al'urance company lirrwhich thc company
is contingcntly Iiahlc in case the nraker tiils to scttlc on March 31. 20 l6 (malurity datc).
). 'Ihc rnerchandise inventory
includes a P 100,000 lronr a consigrror .
-6. 1'hc prepaid cxpense is the total cost ela two year insurance cxpiring on Junc 30,20l: .

What amount oi currcn! assct should be reportetl in thc l)ecernbcr 31, 2015 slatement o{' linancial position oI
I)ecov Company?
a.
h
I'-1.100,0()0
I)J.5()().000
c.
d.
P4.700.000
P4.900.000
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